EXECUTION DRAFT
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US$ 100,000,000
CREDIT AGREEMENT
between
INTERNATIONAL SPEEDWAY CORPORATION
and
FIRST UNION NATIONAL BANK
as of May 5, 1998
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TABLE OF CONTENTS
PAGE
Preliminary Statement.........................................................1
ARTICLE I
DEFINITIONS..........................................................1
ARTICLE II
ADVANCES.............................................................5
2.1 Availability of Advances..................................5
2.2 Principal Repayment.......................................6
2.3 Request for Advances......................................6
2.4 Purpose of Advances.......................................7
2.5 Interest..................................................7
ARTICLE III
ADDITIONAL PROVISIONS RELATING TO THE ADVANCES.......................8
3.1 Interest Rate Limitation..................................8
3.2 Payments to Principal Office..............................8
3.3 Default Rate..............................................9
3.4 Limitation of All Advances................................9
3.5 Indebtedness..............................................9
3.6 Indemnification and Additional Costs......................9
3.7 Guaranties...............................................10
ARTICLE IV
CONDITIONS TO ADVANCES..............................................11
4.1 Representations and Warranties...........................11
4.2 Performance of Obligations...............................11
4.3 Documentation............................................11
4.4 Events of Default or Unmatured Events of Default.........11
ARTICLE V
REPRESENTATIONS AND WARRANTIES......................................12
5.1 Incorporation............................................12
5.2 Power and Authority......................................12
5.3 Indebtedness.............................................12
5.4 Asset Ownership; Liens and Encumbrances..................12
5.5 Investments..............................................13
5.6 Litigation...............................................13
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5.7 Tax Returns...............................................13
5.8 Contract or Restriction...................................13
5.9 ERISA Requirement.........................................14
5.10 Possession of Franchises and Licenses.....................14
5.11 Governmental Authorization................................14
5.12 Financial Condition.......................................14
5.13 Compliance with Laws......................................14
5.14 Regulation U..............................................15
5.15 Material Facts............................................15
5.16 Claims and Offsets........................................15
5.17 Intent and Effect of Transactions.........................16
ARTICLE VI
COVENANTS............................................................16
6.1 Reports, Certificates and Other Information...............16
6.2 Compliance with Laws......................................18
6.3 Further Assurances........................................18
6.4 Insurance.................................................18
6.5 Conduct of Business.......................................19
6.6 Maintain Existence and Rights.............................19
6.7 Right of Inspection.......................................19
6.8 Substantial Banking Relationship..........................19
6.9 Payments to Affiliates....................................19
6.10 Compliance with ERISA.....................................19
6.11 Indebtedness..............................................20
6.12 Liens.....................................................20
6.13 Permitted Investments.....................................20
6.14 Extraordinary Dividends and Other Payments................20
6.15 Merger, Consolidation, Recapitalization and Acquisition...21
6.16 Sale of Assets............................................21
6.17 Transactions with Affiliates..............................21
6.18 Change in Business........................................21
6.19 Leases....................................................21
6.20 Change in Fiscal Year.....................................22
6.21 Consolidated Leverage Ratio...............................22
6.22 "Funded Debt to Capitalization Ratio".....................22
6.23 "Major Motorsports Events"................................22
6.24 Guaranties of Subsidiaries................................22
ARTICLE VII
EVENTS OF DEFAULT....................................................22
7.1 Events of Default.........................................22
7.2 Remedies..................................................24
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ARTICLE VIII
MISCELLANEOUS........................................................25
8.1 Waiver of Default.........................................25
8.2 Amendments and Waivers....................................25
8.3 Notices...................................................25
8.4 No Waiver; Cumulative Remedies............................27
8.5 Exercise of Remedies......................................27
8.6 Survival of Representations, Warranties and Agreements....27
8.7 Liens; Set Off by Bank....................................27
8.8 Entire Agreement..........................................27
8.9 Enforceability............................................28
8.10 Reimbursement of Expenses.................................28
8.11 Execution of Counterparts.................................28
8.12 Stamp or Other Taxes......................................28
8.13 Waiver of Jury Trial; Arbitration.........................28
8.14 Governing Law.............................................29
EXHIBITS
EXHIBIT A Promissory Note
EXHIBIT B Form of Guaranty
EXHIBIT C Form of Opinion of Counsel to Borrower
EXHIBIT D Form of Consolidated Cash Flow Projections
SCHEDULES
SCHEDULE 5.1 List of All Existing Subsidiaries
SCHEDULE 5.3 Existing and Continuing Indebtedness
SCHEDULE 5.4 Permitted Liens
SCHEDULE 5.5 Investments
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EXECUTION DRAFT
CREDIT AGREEMENT
This Credit Agreement made and entered into as of May 5, 1998 (together
with any renewals, extensions, amendments, modifications, restatements and/or
supplements hereto, this "Agreement"), between INTERNATIONAL SPEEDWAY
CORPORATION, a Florida corporation ("Borrower"), and FIRST UNION NATIONAL BANK,
a national banking association ("Bank").
PRELIMINARY STATEMENT
WHEREAS, Borrower has requested that Bank make available, and subject
to the terms and conditions set forth herein Bank has agreed to make available
to Borrower, a line of credit (the "Credit Facility") in the initial aggregate
principal amount of US$25,000,000, with increases (under certain circumstances
more fully described herein) up to but not exceeding an aggregate principal
amount of $100,000,000;
NOW, THEREFORE, for good and valuable consideration, the sufficiency
and receipt of which are hereby acknowledged by each of Borrower and Bank, and
subject to the terms and conditions set forth herein, the parties hereby agree
as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, all terms used herein without
definition that are defined in the Uniform Commercial Code, as enacted and in
force from time to time in the State of Florida (the "Uniform Commercial Code"),
have the same meanings herein as they have in the Uniform Commercial Code. In
addition, the following terms have the following meanings:
1.1 "ADVANCE" or "ADVANCES" (as the context may require) means an
advance of loan monies to Borrower pursuant to this Agreement on any given
Advance Date.
1.2 "ADVANCE DATE" means the date as of which an Advance is made.
1.3 "AFFILIATE" or "AFFILIATES" (as the context may require) means, as
to any Person, (i) any individual related by blood or marriage and (ii) any
corporation or other Person directly or indirectly owned or controlled by,
owning or controlling or under
common ownership or control with such Person. "Control" shall be deemed to
include, but shall not be limited to, the power, directly or indirectly, to
direct or cause the direction of the management or policies of another Person,
whether through ownership, common directors, trustees or officers, by contract
or otherwise. All Subsidiaries shall be deemed to be Affiliates. In addition,
for purposes of this Agreement, unless otherwise indicated, "Homestead - Miami
Speedway, L.L.C." shall also be deemed an affiliate of Borrower.
1.4 "BANKRUPTCY CODE" means Bankruptcy Reform Act of 1978, as amended,
11 U.S.C. /section/101, ET SEQ.
1.5 "BORROWER" means International Speedway Corporation, a Florida
corporation.
1.6 "BUSINESS DAY" means a day on which Bank's Principal Office is open
for business; and "LONDON BUSINESS DAY" means any Business Day that is also a
day on which banking institutions in London, England are open for business.
1.7 "COMMENCEMENT DATE" means May 1, 1998, or such other date as shall
be mutually agreed upon by Bank and Borrower.
1.8 "CONSOLIDATED EBITDA" means the aggregate consolidated gross
earnings of Borrower and its Subsidiaries, before application of interest
charges, taxes, depreciation and amortization, as determined in accordance with
Generally Accepted Accounting Principles consistently applied.
1.9 "CONSOLIDATED FUNDED INDEBTEDNESS" means Indebtedness constituting
money borrowed by Borrower that shall have been or should be, in accordance with
Generally Accepted Accounting Principles, recorded or classified as a liability,
on a consolidated basis.
1.10 "CONSOLIDATED SHAREHOLDERS EQUITY" means the shareholders equity
of Borrower, as reported on the consolidated financial statements of Borrower,
in accordance with Generally Accepted Accounting Principles.
1.11 "CREDIT DOCUMENT" or "CREDIT DOCUMENTS" (as the context may
require) means this Agreement, the Note, the Guaranties, and all other
affidavits, documents, instruments, certificates or agreements delivered or
hereafter delivered pursuant to the terms hereof or otherwise evidencing the
Advances or any other Indebtedness of Borrower to Bank.
1.12 "CREDIT FACILITY" means the line of credit made available to
Borrower by Bank pursuant hereto.
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1.13 "ERISA" means the Employee Retirement Income Security Act of 1974,
together with all amendments from time to time thereto, including any rules or
regulations promulgated thereunder.
1.14 "EVENT OF DEFAULT" shall have the meaning specified in ARTICLE VII
hereof.
1.15 "EXECUTIVE OFFICER" means, for purposes of this Agreement and the
Credit Documents, any one of the chief executive officer, executive vice
president, the chief financial officer or the chief operating officer of
Borrower.
1.16 "GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means the then
prevailing principles and practices of the accounting profession conforming to
the standards of the American Institute of Certified Public Accountants.
1.17 "GUARANTY" or "GUARANTIES" (as the context may require) means
those certain Unconditional guaranties issued and to be issued by each
Subsidiary to and in favor of Bank, guarantying amounts owing hereunder and
under the Note, in substantially the form of EXHIBIT B hereto.
1.18 "INDEBTEDNESS" of a Person means all indebtedness (other than
indebtedness to suppliers for the purchase of products and merchandise incurred
in the ordinary course of business), including, without limitation, (a)
indebtedness for borrowed money; indebtedness for (or deferred purchase price in
connection with) the acquisition of property or assets; indebtedness obligations
evidenced by debentures, notes or other similar instruments; reimbursement or
other similar obligations arising in connection with letters of credit, surety
bonds or reimbursement obligations therefor; and indebtedness of third parties
secured by any lien, pledge or other encumbrance on the property or assets of
the Person in question, whether or not such indebtedness is assumed; (b) all
liability by way of endorsements (other than for collection or deposit in the
ordinary course of business); (c) all guarantees of indebtedness (including any
'keepwell' or other agreement, contingent or otherwise, to purchase any
obligation representing such indebtedness or property constituting security
therefor, or to advance or supply funds for such purpose or to maintain working
capital or any other balance sheet or income statement condition, or otherwise
to assure a creditor against loss in respect of indebtedness or obligations of
others, or any other arrangement in substance affecting any of the foregoing);
(d) liabilities in respect of unfunded vested benefits under plans covered by
Title IV of ERISA; and (e) obligations as lessee under leases (including
synthetic leases) which shall have been or should be, in accordance with
Generally Accepted Accounting Principles, recorded or classified as capital
leases or financing leases; PROVIDED that, for purposes of this Agreement, that
certain Keepwell Agreement dated as of August, 1997 with respect to Homestead -
Miami Speedway, L.L.C. shall not be Indebtedness of Borrower.
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1.19 "INTEREST PERIOD" means (i) in the case of Advances bearing
interest calculated on the basis of the LIBOR Market Index Rate, three (3)
months, and (ii) in the case of Advances bearing interest calculated on the
basis of the LIBOR Rate, any of one(1) month, two (2) months or three (3)
months, as selected by Borrower on the date of the initial Advance hereunder and
immediately preceding the commencement of each Interest Period thereafter,
PROVIDED that no Interest Period shall extend beyond the Maturity Date.
1.20 "IRC" means the Internal Revenue Code of 1986, as amended from
time to time.
1.21 "LIBOR MARKET INDEX RATE", for any day, means the rate (rounded to
the next higher 1/100 of 1%) for one-month United States dollar-denominated
deposits as reported (or if not so reported, then as determined by Bank from
another recognized source of interbank quotation) on Telerate page 3750 as of
11:00 a.m., London time, for such day; PROVIDED that if such day is not a London
Business Day, then for the immediately preceding London Business Day.
1.22 "LIBOR RATE", for any day, means the rate (rounded to the next
higher 1/100 of 1%) for United States dollar-denominated deposits of that many
months maturity as reported (or if not so reported, then as determined by Bank
from another recognized source of interbank quotation) on Telerate page 3750 as
of 11:00 a.m., London time, for the second London Business Day immediately
preceding the day on which the relevant Interest Period begins (PROVIDED that if
such day is not a London Business Day, then for the immediately preceding London
Business Day), adjusted for reserves by dividing that rate by 1.00 MINUS the
LIBOR Reserve. "LIBOR Reserve" is the maximum percentage reserve requirement
(rounded to the next higher 1/100 of 1% and expressed as a decimal) in effect
for any date during the Interest Period under the Federal Reserve Board's
Regulation D for Eurocurrency Liabilities as defined herein.
1.23 "MATURITY DATE" means April 30, 2003, as such date may be extended
or modified with the consent of Bank and Borrower.
1.24 "NASCAR" means the National Association for Stock Car Auto Racing,
Inc.
1.25 "NON-COMPANY AFFILIATE" means any Affiliate of either Borrower or
a Subsidiary that is neither Borrower nor a Subsidiary.
1.26 "NOTE" means that certain promissory note of even date herewith
made by Borrower to and in favor of Bank, in substantially the form of EXHIBIT A
hereto, in the original principal amount of US$100,000,000, evidencing the
obligations of Borrower arising with respect to the Credit Facility; together
with any
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renewals, modifications, restatements, supplements, extensions or amendments
thereto.
1.27 "PERSON" means any individual, firm, corporation, company,
partnership, trust, trustee, agent, employee, organization, association or
entity.
1.28 "PRIME RATE" means the rate of interest per annum announced by
Bank from time to time to be its commercial prime rate, IT BEING UNDERSTOOD that
such rate is one of several interest rate basis used by Bank and is not
represented or intended necessarily to be the lowest or most favorable rate for
any particular type or category of customer or loan; and IT BEING FURTHER
UNDERSTOOD that any change in the prime rate shall be effective as of the
Business Day on which such change is announced.
1.29 "PRINCIPAL OFFICE" means the office of Bank at First Union
National Bank Building, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or such
other address as Bank may from time to time designate by notice to Borrower.
1.30 "RETURNS" has the meaning set forth in Section 5.7 hereof.
1.31 "SALE" means any sale, transfer, assignment, or other disposition,
whether or not for value or for fair value, and regardless of the consideration
(cash, property or otherwise), if any, transferred therefor.
1.32 "SUBSIDIARY" or "SUBSIDIARIES" (as the context may require) of a
Person means any other Person of which 50% or more of the issued and outstanding
voting stock or other indicia of ownership and/or control are owned or
controlled directly or indirectly by such Person. For purposes of this
Agreement, all Subsidiaries are also Affiliates.
1.33 "TAX" or "TAXES" (as the context may require) of a Person means
any federal, state, county, local, or other tax (including, without limitation,
income, profits, estimated, excise, sales, use, occupancy, gross receipts,
franchise, ad valorem, severance, production, transfer, withholding, employment
and payroll-related, real estate and property taxes, import duties, alternative
minimum tax and other similar governmental charges and assessments) due from or
in respect of such Person, and including interest, additions to tax or interest,
and penalties with respect thereto.
1.34 "TAXING AUTHORITY" means any governmental or regulatory body with
jurisdiction over matters relating to the payment of Taxes.
1.35 "UNMATURED EVENT OF DEFAULT" means the occurrence of any event
that with the giving of notice, the lapse of time or both would constitute an
Event of Default.
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ARTICLE II
ADVANCES
2.1 AVAILABILITY OF ADVANCES. Upon the terms and subject to the
conditions of this Agreement and the other Credit Documents, Bank agrees to make
available to Borrower, on and after the Commencement Date, Advances under the
Credit Facility in an aggregate amount not exceeding $25,000,000, PROVIDED that,
at any time after the Commencement Date but prior to the Maturity Date, and no
less frequently than within thirty (30) days after the end of each fiscal
quarter, Borrower shall inform Bank in writing of Borrower's projected needs
based on Borrower's most recent consolidated cash flow projections (a copy of
which shall simultaneously be delivered to Bank substantially in the form of
Exhibit D), whereupon the aggregate amount available under the Credit Facility
shall be automatically adjusted in increments of $10,000,000 (PROVIDED that an
increase of less than $10,000,000 will be permitted if an increase of
$10,000,000 would cause the aggregate principal amount available hereunder to
exceed $100,000,000) to reflect such projected needs, IT BEING UNDERSTOOD and
agreed that (i) the aggregate principal amount available under the Credit
Facility shall not exceed $100,000,000; and (ii) in no event shall the aggregate
principal amount available under the Credit Facility be increased if such
increase would cause Borrower to be in default of the covenants (including the
financial ratio covenants set forth in Article VI) and obligations hereunder and
under the Note. Advances made to Borrower under the Credit Facility shall be
evidenced by the Note, which Borrower has delivered on the date hereof. Pursuant
to the Credit Facility commitment, Borrower may borrow, pay, re-borrow, and
repay from Bank on a revolving basis, from time to time, but prior to the
Maturity Date, such aggregate amounts as may then be available in accordance
with the requirements of this Agreement; PROVIDED, HOWEVER, that (i) the
principal amount requested for any funding shall be not less than $1,000,000,
and (ii) the aggregate principal sum of all amounts so requested and outstanding
at any one time under the Note shall never exceed the aggregate principal amount
applicable under the terms of this Agreement. On or after the Maturity Date, no
additional Advances will be made under the Credit Facility.
2.2 PRINCIPAL REPAYMENT. Except to the extent required under Article
VII (events of default), Borrower shall make payment in full of the entire
outstanding principal amount of the Note (together with all accrued and unpaid
interest thereon), on or before the Maturity Date.
2.3 REQUEST FOR ADVANCES. Each request for an Advance under the Note
shall be in writing executed by an Executive Officer of Borrower and
specifically requesting a borrowing of funds under the Credit Facility and
certifying that, to the best of his/her knowledge after due inquiry (1) no Event
of Default and no Unmatured Event of Default has occurred or is continuing under
the terms of any of the Credit Documents, and (2) all representations and
warranties contained in the Credit
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Documents are true and correct as of the date of such requested Advance, and all
obligations to be performed by Borrower under the Credit Documents have been
duly performed. Any request for an Advance under the Credit Facility shall be
given to Bank not later than 11:00 a.m. (EST) at least three (3) Business Days
prior to the day upon which the Advance is requested to be advanced. Any such
request shall also (a) state the amount and date of the requested Advance, (b)
state the interest rate calculation basis selected by Borrower (either LIBOR
Market Index Rate or LIBOR Rate) and if Borrower has selected the LIBOR Rate,
also state the selected Interest Period duration (one month, two month or three
month), and (c) be, and shall state that it is, requested for a purpose that is
permitted by this Agreement. Notices received after 11:00 a.m. shall be deemed
to have been received on the next Business Day.
2.4 PURPOSE OF ADVANCES. Any advances made to Borrower hereunder shall
be used by Borrower solely (i) to provide general working capital to support
Borrower's business, (ii) for the payment of ordinary expenses incurred in the
normal operation of Borrower's business, and (iii) for any other purpose
explicitly stated to be contemplated by this Agreement. Without limiting the
generality of the foregoing, Borrower shall not use, and shall not allow any
Affiliate to use, any of such funds for any impermissible purpose.
2.5 INTEREST. (a) RATE OF INTEREST. Subject to the provisions hereof,
the aggregate outstanding principal amount of Advances shall bear interest at a
per annum rate equal to THE SUM OF (i) either (x) the LIBOR Market Index Rate or
(y) the LIBOR Rate (as selected by Borrower on the date of the initial closing
of this Agreement and from time to time in accordance herewith), PLUS (ii) the
applicable percentage amount set forth below:
IF THE RATIO OF CONSOLIDATED THEN THE APPLICABLE
FUNDED INDEBTEDNESS TO EBITDA IS: PERCENTAGE IS:
--------------------------------- --------------
0 - less than 1.5:1 .40%
1.5:1 - less than 2.5:1 .60%
2.5:1 - less than 3.0:1 .80%
Interest shall be calculated on the outstanding principal balance of the Note
and shall be computed on the basis of a year of three hundred sixty (360) days,
calculated for the actual number of days elapsed. When the LIBOR Market Index
Rate is selected as the basis upon which the rate of interest on outstanding
Advances is to be calculated, such rate of interest shall be adjusted daily to
reflect the LIBOR Market Index Rate, and the LIBOR Market Index Rate will
continue as the basis upon which such rate of interest is calculated until
Borrower shall otherwise indicate in writing to Bank. When the LIBOR Rate is
selected as the basis upon which the rate of interest on outstanding Advances is
to be calculated, such rate of interest shall be fixed for the Interest Period,
IT BEING UNDERSTOOD that if Borrower fails to notify Bank in writing of its
selection of the LIBOR Rate as the continuing basis upon which the rate of
interest hereunder shall be calculated, upon the expiration of such Interest
Period,
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Borrower shall be deemed to have selected the LIBOR Market Index Rate as the
basis upon which the rate of interest hereunder shall thereafter be calculated.
(b) SELECTION OF INTEREST RATE. On the date of the initial Advance
hereunder and on the third Business Day immediately preceding the last day of
each Interest Period, Borrower shall select either the LIBOR Market Index Rate
or the LIBOR Rate as the basis on which the rate of interest applicable to
Advances outstanding shall be calculated, IT BEING UNDERSTOOD that if Borrower
fails to notify Bank in writing of its selection of the basis (either LIBOR
Market Index Rate or LIBOR Rate) upon which the rate of interest hereunder shall
be calculated, upon the expiration of the then current Interest Period, Borrower
shall be deemed to have selected the LIBOR Market Index Rate as the basis upon
which the rate of interest hereunder shall thereafter be calculated. If Borrower
shall at any time select the LIBOR Rate as the basis on which the rate of
interest applicable to Advances outstanding shall be calculated, then Borrower
shall also notify the Bank of its selection of the duration of the Interest
Period (either one month, two month or three month), IT BEING UNDERSTOOD that if
Borrower fails to notify Bank in writing of its selection of such duration, then
Borrower shall be deemed to have selected the three month LIBOR Rate as the
basis upon which the rate of interest hereunder shall thereafter be calculated.
During each Interest Period, the rate of interest so selected shall apply
continuously.
(c) PAYMENT OF INTEREST. All accrued Interest shall be payable on the
last day of each Interest Period, IT BEING UNDERSTOOD that (i) if such last day
shall not be a London Business Day, then all accrued Interest shall be payable
on the London Business Day immediately following such day, unless such
succeeding day falls in a different calendar month, in which event, such
Interest shall be payable on the London Business Day immediately preceding such
last day, and (ii) in any event all accrued and unpaid Interest shall be paid in
full on the Maturity Date.
ARTICLE III
ADDITIONAL PROVISIONS RELATING TO THE ADVANCES
3.1 INTEREST RATE LIMITATION. Notwithstanding anything to the contrary
contained in any of the Credit Documents, if any specified interest rate shall
exceed the maximum rate permitted by applicable law as in effect from time to
time, Borrower shall pay interest at the highest permissible rate, which rate
shall change as and when the highest permissible rate shall change. If Borrower
makes an interest payment under any of the Credit Documents that exceeds the
maximum amount of interest permitted by applicable law, the excess of such
payment above the maximum amount that lawfully may be paid shall be refunded to
Borrower or, at Borrower's option, credited toward the payment of principal due
under such Credit Document (as directed by Borrower); or, if Borrower makes an
interest payment that exceeds the maximum amount of interest permitted by
applicable law and all principal thereunder
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shall have been previously or thereby paid in full, such payment shall be deemed
to have been the result of mathematical error and Bank shall refund to Borrower
the amount of such payment that is in excess of the amount that lawfully may be
paid.
3.2 PAYMENTS TO PRINCIPAL OFFICE. Each payment of principal (including
any prepayment), interest and any other amount required to be paid to Bank
pursuant to this Agreement, the Note or any other Credit Document shall be made
to Bank at its Principal Office, in immediately available funds constituting
legal tender in the United States of America for the payment of public and
private debts, on or before 11:00 a.m. Jacksonville, Florida, time on the date
such payment is due. IN CASE ANY SUCH PAYMENT IS NOT SO MADE, BANK IS HEREBY
AUTHORIZED TO, BUT SHALL NOT BE OBLIGATED TO, DEBIT THE AMOUNT OF SUCH PAYMENT
FROM ANY ONE OR MORE ACCOUNTS OF BORROWER WITH BANK.
3.3 DEFAULT RATE. In the event that any payment of principal of,
interest on or other amount with respect to this Agreement, the Note or any of
the other Credit Documents is not made when due or any other Event of Default
shall have occurred and be continuing, such unpaid amount shall continue to be
an obligation of Borrower hereunder and shall bear interest from the due date
thereon until paid in full in the manner provided in SECTION 3.2 hereof, at a
rate of interest per annum equal to five percent (5%) IN EXCESS OF the LIBOR
Market Index Rate (the "Default Rate"). Notwith standing the foregoing, failure
to make any payment when due in the manner provided in the immediately preceding
paragraph shall constitute an Event of Default hereunder. The Default Rate shall
also apply from acceleration until all obligations owing hereunder, under the
Note, and under the other Credit Documents, or any judgment thereon, is paid in
full.
3.4 LIMITATION OF ALL ADVANCES. Notwithstanding any other provision of
this Agreement, no Advance hereunder shall be made if the conditions precedent
contained herein and in the other Credit Documents have not been fully satisfied
and performed. Bank shall not be obligated to honor any request for an Advance
if an Event of Default or an Unmatured Event of Default shall have occurred or
be continuing. In addition, Bank shall not be obligated to fund any amount in
excess of its lending limitation as determined by applicable law; IT BEING
UNDERSTOOD that the aggregate amount that could become available pursuant to
this Agreement (i.e., $100,000,000) and under the circumstances presently
encompassing Borrower and Bank, is in compliance with the lending limitations as
are applicable to Bank.
3.5 INDEBTEDNESS. At the time of each Advance made under or pursuant to
this Agreement, Borrower shall immediately become indebted to Bank for the
amount of such Advance, which Advance shall be made in immediately available
funds.
3.6 INDEMNIFICATION AND ADDITIONAL COSTS. (a) INDEMNIFICATION. Borrower
indemnifies Bank against Bank's loss or expense in employing deposits as a
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consequence (a) of Borrower's failure to make any payment when due under this
Agreement or the Note or (b) of any payment, prepayment or conversion of any
Advance on a date other than the last day of the Interest Period ("Indemnified
Loss or Expense"). Borrower also indemnifies and holds Bank, its Affiliates,
officers, directors, employees, agents and representatives ("Indemnified
Persons") harmless to the fullest extent permitted by law from and against all
claims, liabilities, damages, or other expenses or costs (including without
limitation reasonable attorneys' fees and expenses) ("Liabilities") incurred by
Bank or any Indemnified Person in connection with or as a result of or arising
out of the making by Bank of the Advances contemplated by this Agreement and the
Note (or, if applicable, any security granted to collateralize the obligations
hereunder), including without limitation liabilities arising from or with
respect to the imposition upon, or incurrence by, Bank of any taxes, fees,
interest, penalties, charges, costs or expenses, except in each case those
liabilities arising from the gross negligence or willful misconduct of the Bank
or any Indemnified Person. This covenant shall survive payment of all amounts
due under this Agreement, the Note and the other Credit Documents.
(b) ADDITIONAL COSTS. If, at any time, a new, or a revision of any
existing, law or interpretation or administration (including reversals) thereof
by any government authority, central bank or comparable agency imposes,
increases or modifies any reserve or similar requirement against assets,
deposits or credit extended by Bank, or subjects Bank to any tax, duty or other
charge (except tax on Bank's net income), and any of the foregoing increase the
cost to Bank of maintaining its commitment or reduce the amount of any sum
received or receivables by Bank under this Note, within 15 days after demand by
Bank, Borrower agrees to pay Bank such additional amounts as will compensate
Bank for such increased costs or reduction ("Additional Costs").
(c) UNAVAILABILITY OF INTEREST RATE. If, at any time, (i) Bank shall
determine that, by reasons of circumstances affecting foreign exchange and
interbank markets generally, LIBOR deposits in the applicable amounts are not
being offered to Bank, or (ii) a new, or a revision in any existing, law or
interpretation or administration (including reversals) thereof by any government
authority, central bank or comparable agency shall make it unlawful or
impossible for Bank to honor its obligations under this Note, then (x) Bank's
obligation to make, maintain or convert into a rate of interest calculated on
the basis of the LIBOR Rate or, if applicable, the LIBOR Market Index Rate shall
be suspended; and (y) the applicable rate of interest so calculated on the basis
of the LIBOR Rate or, if applicable, the LIBOR Market Index Rate shall
immediately be converted to a rate of interest calculated for the remainder of
the Interest Period on the basis of the rate of interest per annum equal to THE
SUM OF (i) the Prime Rate, MINUS (ii) the applicable percentage amount set forth
below:
IF THE RATIO OF CONSOLIDATED THEN THE APPLICABLE
FUNDED INDEBTEDNESS TO EBITDA IS: PERCENTAGE IS:
--------------------------------- --------------
0 - less than 1.5:1 2.00%
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1.5:1 - less than 2.5:1 1.80%
2.5:1 - less than 3.0:1 1.60%
Interest shall be calculated on the outstanding principal balance of the Note
and shall be computed on the basis of a year of three hundred sixty (360) days,
calculated for the actual number of days elapsed.
3.7 GUARANTIES. The obligations of Borrower hereunder and under the
Note shall at all times be guaranteed by all Subsidiaries of Borrower, whether
now existing or hereafter acquired or created, pursuant to an Unconditional
Guaranty executed and delivered by each Subsidiary, in substantially the form of
EXHIBIT B hereto.
ARTICLE IV
CONDITIONS TO ADVANCES
The obligation of Bank to make the Advances hereunder is subject to the
following conditions precedent, which must be satisfied at the time each Advance
is to be made hereunder:
4.1 REPRESENTATIONS AND WARRANTIES. All representations and warranties
made by Borrower in this Agreement and the other Credit Documents or in any
list, schedule, document or certificate delivered to Bank in connection herewith
or therewith shall have been true as of the time made and shall be true on the
date of each Advance.
4.2 PERFORMANCE OF OBLIGATIONS. Borrower shall have performed all of
its obligations under the Credit Documents to be performed on or before the date
of the Advance.
4.3 DOCUMENTATION. All instruments and documents incident to the
issuance and delivery of the Credit Documents shall be satisfactory in form and
substance to Bank and counsel for Bank; and Bank shall have received:
(1) Two executed counterparts of each of the Credit
Documents not previously executed and delivered to
Bank,
(2) Two executed counterparts of a Guaranty executed by
each Subsidiary of Borrower,
(3) All other documents that it may reasonably request in
connection therewith, including certified copies of
the Articles of Incorporation, By-Laws and
resolutions of Borrower
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authorizing the transactions contemplated by the
Credit Documents, and certificates of good standing,
and
(4) With respect only to the initial closing of this
Agreement, the favorable opinion of counsel for
Borrower, in form and substance substantially similar
to EXHIBIT C hereto.
4.4 EVENTS OF DEFAULT OR UNMATURED EVENTS OF DEFAULT. No Event of
Default or Unmatured Event of Default shall exist.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
In order to induce Bank to enter into this Agreement and to commit to
make the Advances hereunder, Borrower represents and warrants to Bank (which
representations and warranties shall survive the delivery of the Credit
Documents and the making of the Advances) as follows:
5.1 INCORPORATION. Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Florida, has the
corporate power to own its properties and to carry on its business as now being
conducted, is duly qualified as a foreign corporation to do business in every
jurisdiction in which the nature of its business makes such qualification
necessary, and is in good standing in all such jurisdictions. SCHEDULE 5.1 sets
forth a true, correct and complete list of all Subsidiaries of Borrower as of
the date hereof.
5.2 POWER AND AUTHORITY. Borrower has the legal capacity and right, and
is duly authorized under all applicable provisions of law, to execute, deliver
and perform each of the Credit Documents, and all corporate and other action on
the part of Borrower required for the lawful execution, delivery and performance
thereof has been duly taken. Each of the Credit Documents, upon execution and
delivery thereof, will be a valid and binding obligation of Borrower,
enforceable in accordance with its respective terms. Neither the execution or
delivery of the Credit Documents, nor the fulfillment of or compli ance with
their provisions and terms, will conflict with, or result in a breach of the
terms, conditions or provisions of, or constitute a violation of or default
under any applicable law, regulation, order, writ or decree, the Articles of
Incorporation or Bylaws of Borrower, or any agreement or instrument to which
Borrower is now or hereafter becomes a party, or create any lien, charge or
encumbrance upon any of Borrower's property or assets pursuant to the terms of
any agreement or instrument to which Borrower is a party or by which Borrower or
any of its properties are bound.
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5.3 INDEBTEDNESS. Borrower does not have any Indebtedness (including,
but not limited to, Indebtedness owing to Affiliates) other than (or in excess
of) the amounts set forth in its most recent financial statements or on SCHEDULE
5.3 hereto.
5.4 ASSET OWNERSHIP; LIENS AND ENCUMBRANCES. Borrower has good and
marketable title to all of the properties and assets reflected on its most
recent audited financial statements (other than replacements, additions or
modifications in such properties and assets that arise in the ordinary course of
Borrower's business and are not material, either individually or in the
aggregate). Borrower does not have any liens, charges, claims or other
encumbrances (collectively, "Liens") on or against any of its properties or
assets other than (i) liens for Taxes being contested in good faith and for
which appropriate reserves have been established and being maintained, (ii)
liens accruing by operation of law for employee benefit liabilities, (iii) liens
imposed by law (such as liens of carriers, warehousemen, mechanics, materialmen
and landlords, and other similar liens incurred in the ordinary course of
business that, either individually or taken as a whole, are not material to the
financial condition of Borrower; (iv) purchase money liens upon property used by
Borrower in the ordinary course of its business, securing Indebtedness incurred
solely to pay all or a portion of the purchase price thereof (including in
connection with capital leases) which liens, either individually or taken as a
whole, would not be material to the financial condition of Borrower; or (v)
those liens set forth on SCHEDULE 5.4 hereto.
5.5 INVESTMENTS. Borrower does not own or control, and is not under any
obligation to purchase or acquire, any stock, securities, bonds, notes or other
evidence of indebtedness issued or to be issued by any Person other than those
listed on its most recent financial statements or on SCHEDULE 5.5 hereto.
5.6 LITIGATION. There are no pending or, to the best of Borrower's
knowledge, threatened actions or proceedings before any court, arbitrator or
governmental or administrative body or agency that could materially adversely
affect the properties, business or condition, financial or otherwise, of
Borrower, or in any way adversely affect or call into question the power or
authority of Borrower to enter into or perform any of the Credit Documents or
the validity or enforceability of any of the Credit Documents.
5.7 TAX RETURNS. Borrower has filed all Tax returns, statements,
reports and forms (collectively, the "Returns") required to be filed by it with
any Taxing Authority in accordance with all applicable laws. Borrower has timely
paid or made provision for (in accordance with Generally Accepted Accounting
Principles) all Taxes shown as due and payable on the Returns that have been
filed, and will timely pay or make provisions for all Taxes shown to be due on
the Returns. There are no liens or other encumbrances for Taxes upon the assets
or properties of Borrower. There are no outstanding agreements or waivers
extending the statutory period of limitation applicable to any Return required
to be filed with respect to Borrower. So long as any amounts are outstanding
under the Note, Borrower will not request any extension of
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time to file any Return unless (i) it or they shall have disclosed such
intention to Bank in writing prior to the filing of such request and (ii) such
extension is not requested as a result of or in connection with a materially
adverse event or circumstances affecting Borrower that has not been previously
disclosed to Bank in writing. All Taxes which are required to be withheld or
collected by Borrower have been duly withheld or collected and, to the extent
required, have been paid to the proper Taxing Authority or properly deposited as
required by applicable law.
5.8 CONTRACT OR RESTRICTION. Borrower is not a party to or bound by any
contract or agreement or is subject to any charter or other corporate or
partnership restrictions that could materially and adversely affect the
business, properties or condition, financial or otherwise, of Borrower or
adversely affect or call into question the power or authority of Borrower to
enter into or perform any of the Credit Documents or the validity or
enforceability of any of the Credit Documents.
5.9 ERISA REQUIREMENT. Borrower has not incurred any material
accumulated funding deficiency within the meaning of ERISA or incurred any
material liability to the Pension Benefit Guaranty Corporation established under
ERISA (or any successor thereto under ERISA) in connection with any employee
pension benefit plan established or maintained by it or by any Person under
common control with it (within the meaning of Section 424(c) of the IRC or of
Section 4001(b) of ERISA), or in which its employees are entitled to
participate. No Reportable Event or prohibited transaction (each as defined in
ERISA) in connection with any such plan has occurred and is continuing, Borrower
is in compliance with all requirements of ERISA and there are no circumstances
that could cause the loss of any such plan's qualification under Section 401(a)
of ERISA.
5.10 POSSESSION OF FRANCHISES AND LICENSES. Borrower possesses all
franchises, certificates, licenses, permits and other authorizations from
governmental subdivisions or regulatory authorities, free from restrictions,
that are necessary in any material respect for the ownership, maintenance or
operation of its properties and the conduct of its business as presently
conducted, and Borrower is not in violation of any thereof.
5.11 GOVERNMENTAL AUTHORIZATION. No authorization, consent, approval,
exemption, franchise, permit, license or action of or filing with any
governmental or public body or authority is required to authorize, or is
required in connection with, the execution, delivery and performance by Borrower
of any of the Credit Documents or the performance of any of the transactions
contemplated hereby or thereby.
5.12 FINANCIAL CONDITION. The financial statements of Borrower as of
August 31, 1996, November 30, 1996, and November 30, 1997, as previously
delivered to Bank, have been prepared in accordance with Generally Accepted
Accounting Principles consistently applied, and accurately reflect the financial
condition of Borrower as of that date. Since November 30, 1997, there has not
been
-14-
any materially adverse change in the business, operations or financial condition
of Borrower, and Borrower has incurred no material liabilities other than those
incurred in the ordinary course of business which is not shown on SCHEDULE 5.3.
5.13 COMPLIANCE WITH LAWS. Borrower is in compliance in all material
respects with all laws, statutes, rules, regulations, orders and decisions of
all governmental authorities that apply to the conduct of its business, its
properties or its assets, including without limitation statutes, regulations or
ordinances, relating to (a) the handling, storage, discharge, leakage, emission,
escape or release of any substance or material that may be considered a
hazardous or toxic substance, waste or material under any governmental statute,
regulation or ruling; (b) the discharge, release or emission of any pollutant on
or into the soil, air or water; (c) wages, hours, hiring, non-discrimination,
promotion, retirement, benefits, pensions and working conditions; (d) land use
requirements; (e) trade and antitrust regulations; and (f) federal and state
laws relating to liquor or narcotics or any commercial crimes. Borrower has all
permits, consents and approvals required by any governmental authority and is in
compliance with all require ments, conditions and limitations contained in or
imposed by such permits.
5.14 REGULATION U. No part of the proceeds of any Advance will be or
has been used to purchase or carry, or to reduce or retire any loan incurred to
purchase or carry, any margin stock (within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System) or to extend credit to others
for the purpose of purchasing or carrying any such margin stock. Borrower is not
engaged as one of its important activities in extending credit for the purpose
of purchasing or carrying such margin stock. If requested by Bank, Borrower will
furnish to Bank, in connection with any Advance, a statement in conformance with
the requirements of Federal Reserve Form U-1 referred to in Regulation U. In
addition, no part of the proceeds of any Advance will be used for the purchase
of commodity future contracts (or margins therefor for short sales) or any
commodity. Neither the making of the Advances nor the use of the proceeds
thereof will violate or be inconsistent with the provisions of Regulations G, T,
U or X issued by the Board of Governors of the Federal Reserve System, in each
case as now in effect or as the same may hereafter be in effect.
5.15 MATERIAL FACTS. Neither any of the Credit Documents nor any
affidavit, document, instrument, certificate or statement furnished to Bank by
or on behalf of Borrower in connection with the transactions contemplated hereby
or thereby contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained herein or
therein not misleading. There is no fact known to Borrower that has not been
disclosed to Bank in writing that materially and adversely affects, or in the
future may materially and adversely affect, the business, operations, properties
or assets or the condition, financial or otherwise, of Borrower.
-15-
5.16 CLAIMS AND OFFSETS. No Event of Default or Unmatured Event of
Default exists and there is no defense, set off or counterclaim against payment
of principal of or interest under the Note or against any other amounts due or
that may become due under the Credit Documents. All defenses, setoffs,
counterclaims or claims against Bank and all affiliated persons and entities,
and all of its officers, directors, shareholders, agents, attorneys and
employees in each case in their roles as such with First Union, and their
respective successors, assigns, heirs and legal representatives, of any nature,
if any, held by Borrower, whether known or unknown, are hereby forever waived,
released and discharged.
5.17 INTENT AND EFFECT OF TRANSACTIONS. The transactions provide for
herein:
(a) Are not made or incurred with the intent to hinder,
delay or defraud any Person to whom Borrower has been, is now or may
hereafter become indebted;
(b) Do not render Borrower insolvent, nor is Borrower
insolvent at the time the transactions provided for herein and the
other Credit Documents are entered into;
(c) Do not leave Borrower with unreasonably small capital
with which to engage in its business, or in any business or transaction
in which it intends to engage; and
(d) Are not entered into with the intent to incur, or with
the belief that Borrower would incur, debts that would be beyond its
ability to pay as such debts mature.
ARTICLE VI
COVENANTS
Borrower covenant and agree that, so long as any portion of the
Advances or any of Borrower's liabilities to Bank remains unpaid or outstanding:
6.1 REPORTS, CERTIFICATES AND OTHER INFORMATION.
(a) ANNUAL FINANCIALS. Within ninety (90) days after the end
of each fiscal year of Borrower, Borrower shall furnish to Bank a copy of the
audited consolidated financial statements of Borrower, prepared in accordance
with Generally Accepted Accounting Principles, consistently applied, together
with an unqualified letter of an independent certified public accounting firm
selected by Borrower and acceptable to Bank and such other information as may be
reasonably requested by Bank. Such statements shall include a balance sheet, a
statement of income and
-16-
expenses, a statement of cash flow and such other and further reports and
schedules as may reasonably be requested by Bank, including without limitation
verification of Borrower's compliance with the financial covenants set forth in
this Agreement. Such statements shall be certified as to their correctness by an
Executive Officer of Borrower.
(b) CONSOLIDATING FINANCIAL STATEMENTS. Within ninety (90)
days after the end of each fiscal year of Borrower, Borrower shall give Bank
access to a copy of the unaudited consolidating financial statements of
Borrower, prepared in accordance with Generally Accepted Accounting Principles,
consistently applied, together with supporting schedules; IT BEING UNDERSTOOD
AND AGREED that such access will be accomplished in the following fashion: the
Senior Credit Officer for Florida, Senior Underwriter responsible for the Credit
Facility and the Senior Portfolio Manager responsible for monitoring the account
may review the unaudited annual consolidating financial statements of Borrower
at the offices of Borrower upon reasonable notice during normal business hours
of Borrower. The representatives reviewing the unaudited consolidating financial
statements of Borrower may make notes of such review. If requested in connection
with Bank's compliance with bank regulatory requirements, Borrower will make a
copy of the unaudited annual consolidating financial statements of Borrower
available solely for such compliance purposes. In such event, the unaudited
annual consolidating financial statements of Borrower will be marked
"confidential", and the review of such materials will be limited to the
individuals listed above and the government examiner who will be required to
acknowledge the confidentiality of the materials prior to review. Bank agrees it
will not furnish a copy of the materials to any other person or agency without
the prior express written consent of the Borrower. Such consolidating statements
shall include a balance sheet and a statement of income and expenses, and such
other and further reports and schedules as may reasonably be requested by Bank,
and shall be certified as to their correctness by an Executive Officer of
Borrower
(c) QUARTERLY FINANCIALS. Within forty-five (45) days after
the end of each fiscal quarter of Borrower, Borrower shall furnish to Bank a
copy of an unaudited management-prepared quarterly consolidated financial
statements of Borrower, prepared in accordance with Generally Accepted
Accounting Principles, consistently applied. Such statements shall include a
balance sheet, a statement of income and expenses, a statement of cash flow and
such other and further reports and schedules as may reasonably be requested by
Bank, and verification of Borrower's compliance with the financial covenants set
forth in this Agreement. Such statements shall also be certified as to their
correctness by an Executive Officer of Borrower.
(d) CERTIFICATES. Contemporaneously with the furnishing of a
copy of each annual report and each quarterly report provided for in this
SECTION 6.1, Borrower shall furnish to Bank a certificate dated the date of each
such report, signed by an Executive Officer, (i) to the effect that (x) no such
report contains any untrue
-17-
statement or omits to state a material fact necessary to make the facts
contained therein not misleading, and (y) to the best of Borrower's knowledge,
after reasonable and customary diligence and review, no Event of Default or
Unmatured Event of Default has occurred and is continuing, or, if there is any
such event, describing it and the steps, if any, being taken to cure it, and (z)
containing a computation of, and showing compliance with, each of the
restrictions contained in this ARTICLE VI; and (ii) requesting that Bank adjust
the aggregate principal amount available under the Credit Facility to reflect
Borrower's projected credit needs based on its most recent financial
projections.
(e) SEC REPORTS. Within ten (10) days of transmittal to its
intended addressees, Borrower shall furnish to Bank (i) a copy of all financial
statements, reports, notices, and proxy statements sent by Borrower to its
shareholders, (ii) all regular or periodic reports required to be filed by
Borrower to the United States Securities and Exchange Commission (the "SEC") or
any other governmental agency or authority, including all exhibits and schedules
thereto (except to the extent previously furnished by Borrower to Bank), other
than Tax returns of Borrower, and (iii) all official press releases distributed
by the investor relations department of Borrower that maybe of general interest
to the investment community and other public announcements of financial results
(such as earnings, etc.) made by Borrower.
(f) NOTICES. Forthwith upon learning of the occurrence of
any of the following, Borrower shall furnish to Bank written notice thereof,
describing the same and the steps being taken by Borrower with respect thereto:
(i) the occurrence of an Event of Default or an Unmatured Event of Default, (ii)
the institution of, or any adverse determination in, any litigation, arbitration
proceeding or governmental proceeding that is material to Borrower, or (iii) if
Borrower learns that any of its representations herein is untrue in any material
respect.
(g) OTHER INFORMATION. From time to time such other
information concerning Borrower as Bank may reasonably request.
6.2 COMPLIANCE WITH LAWS. Borrower shall comply with all statutes and
governmental rules and regulations and pay promptly when due all taxes,
assessments, governmental charges, claims for labor, supplies, rent and other
obligations that, if unpaid, might become a lien against the property of
Borrower, EXCEPT liabilities being contested in good faith, PROVIDED, HOWEVER,
that Borrower will set up reserves against such liabilities to the extent (and
in the amounts) required by Generally Accepted Accounting Principles.
6.3 FURTHER ASSURANCES. Upon the reasonable request of Bank, Borrower
shall execute, acknowledge and deliver such further instruments (including,
without limitation, a declaration of no set-off) and do such further acts as may
be necessary, desirable or proper to carry out more effectively the purpose of
this Agreement and any renewals, additions, substitutions, replacements or
betterments thereto.
-18-
6.4 INSURANCE. Borrower shall keep all of its insurable assets insured
with responsible insurers, rated "A" or better by A.M. Best & Company, in
accordance with good business practice in such amounts as may be reasonably
requested by Bank or, in the absence of any such request, as are customarily
maintained by companies engaged in similar businesses, but in no event in an
amount less than the replacement cost of such assets. Borrower shall provide
Bank with one or more certificates evidencing such insurance. Borrower shall
timely pay all premiums and amounts necessary to keep such insurance in full
force and effect.
6.5 CONDUCT OF BUSINESS. Borrower shall conduct its business
substantially as now conducted and as previously represented to Bank, in the
ordinary course, and will not expand into other different types of unrelated
business.
6.6 MAINTAIN EXISTENCE AND RIGHTS. Borrower shall maintain, preserve
and keep its properties in good repair, working order and condition, making all
needed replacements, additions and improvements thereto. Borrower shall cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence, rights and franchises and to comply with all laws
applicable to it, shall be qualified to do business and in good standing in the
State of Florida and every other jurisdiction in which the nature of its
business makes such qualification necessary and shall not suffer or permit its
dissolution or liquidation, in whole or in part.
6.7 RIGHT OF INSPECTION. Subject to the provisions and conditions
described in SECTION 6.1(b) with respect to consolidating financial statements
of Borrower, Borrower shall permit or arrange for Bank or its duly authorized
representatives to visit and inspect Borrower's other assets, examine Borrower's
books of account and make copies thereof and extracts therefrom and discuss its
affairs, finances and accounts with its officers and independent public
accountants, all upon reasonable notice at such reasonable times during normal
business hours and as often as may be reasonably desired by Bank, IT BEING
UNDERSTOOD that Bank and its agents shall not disclose to any Person any
confidential information regarding the Borrower except (i) as required by law,
or court or administrative order, (ii) information otherwise publicly available
or freely usable or obtained from another public source, (iii) basic and general
information regarding the level of lending activity and deposit activity and
account status, given in response to an inquiry from a creditor of Borrower, or
(iv) with the consent of Borrower.
6.8 SUBSTANTIAL BANKING RELATIONSHIP. Borrower shall maintain a
substantial banking relationship with Bank, which shall include the
proportionate maintenance of depository balances at historic relationship
levels.
6.9 PAYMENTS TO AFFILIATES. Borrower shall not make payments of any
kind (other than regularly scheduled salary, expense reimbursement and similar
benefit payments, bonuses, lease or other ordinary course payments) to any
Non-Company Affiliate on account of Indebtedness owed by Borrower, whether now
existing or
-19-
subsequently incurred, other than payments that may become due pursuant to that
certain Keepwell Agreement dated as of August, 1997 with respect to Homestead
-Miami Speedway, L.L.C.
6.10 COMPLIANCE WITH ERISA. Borrower shall cause each employee benefit
plan to remain qualified under Section 401(a) of the IRC and remain in
compliance with the provisions of ERISA. With respect to any such plan, Borrower
shall not shall cause or permit to be caused any material accumulated funding
deficiency (as described in SECTION 5.9 hereof), any material liability to the
Pension Benefit Guaranty Corporation, any Reportable Event or prohibited
transaction (as described in SECTION 5.9 hereof), or any action, the effect of
which could result in the loss of a Plan's compliance with ERISA or
qualification under Section 401(a) of the IRC.
6.11 INDEBTEDNESS. Borrower shall not incur, create, assume or permit
to exist any Indebtedness of Borrower other than (i) Indebtedness owed to Bank,
(ii) the Indebtedness disclosed on its then current financial statements of
Borrower delivered to Bank or on SCHEDULE 5.3 hereto, (iii) Indebtedness
(including guarantees therefor) in a principal amount not to exceed $85,000,000
in the aggregate in connection with the purchase of and financing for the Kansas
City racetrack currently under consideration, and (iv) guarantees by Borrower of
Indebtedness of one or more Subsidiaries not in excess of ten percent (10%) of
Borrower's Total Shareholders' Equity (as shown on its most recent consolidated
financial statements filed with the Securities and Exchange Commission (the
"SEC")) in the aggregate. Borrower shall furnish to Bank a detailed list of all
Indebtedness and other liabilities within the annual audited financial
statements referred to in SECTION 6.1(a).
6.12 LIENS. Borrower shall not incur, create, assume or permit to exist
any mortgage, pledge, security interest, lien, charge or other encumbrance of
any kind on any of Borrower's other assets other than (i) those arising under
the Credit Documents, (ii) those set forth on SCHEDULE 5.4 hereof, and (iii)
those permitted liens described in subparagraphs (i), (ii), and (iii) of SECTION
5.4.
6.13 PERMITTED INVESTMENTS. Borrower shall not invest or otherwise
purchase any stock, securities, bonds, notes or other evidences of indebtedness
issued by any other Person other than (i) investments in direct or indirect
obligations of the United States Government; (ii) certificates of deposit of
United States commercial banks having a "Tier 1" capital ratio of not less than
6%, PROVIDED that in the case of investments in or purchases of such
certificates of deposit, the aggregate amount of such purchases and/or
investments shall not exceed ten percent (10%) of the issuing bank's unimpaired
capital and surplus; (iii) those investments set forth on SCHEDULE 5.5; and (iv)
investments of any kind so long as the aggregate amount of such investments do
not exceed five percent (5%) of Borrower's Total Shareholders' Equity (as shown
on its most recent consolidated financial statements filed with the SEC),
provided, however, that nothing in this SECTION 6.13 shall prevent Borrower from
investing in motorsports facilities or related motorsports businesses
-20-
so long as any such investments, in the aggregate, do not have a material
adverse effect on the consolidated financial condition of Borrower or any of its
Subsidiaries.
6.14 EXTRAORDINARY DIVIDENDS AND OTHER PAYMENTS. Borrower shall not,
directly or indirectly, purchase, redeem or otherwise retire any capital stock
in advance of the regularly scheduled date for such retirement, or apply or set
apart any of its assets therefor, other than repurchases, redemptions or
retirements in connection with Borrower's long-term incentive compensation plans
approved by Borrower's shareholders and on file with the Securities and Exchange
Commission; or make any other extraordinary distribution (by reduction of
capital or otherwise) in respect of any such capital stock (other than ordinary
dividends and transfers expressly contemplated herein), or agree to do any of
the foregoing; or make any loan or other payment (other than salary and other
payments expressly permitted herein and other than (i) those permitted by
SECTION 6.11, (ii) payments owing under that certain Keepwell Agreement dated as
of August, 1997 with respect to Homestead-Miami Speedway, L.L.C., (iii) payments
owing to any Affiliate, or (iv) loans to and/or payments owing to any
shareholder who (x) holds five percent (5%) or less of the voting capital stock
of Borrower and (y) is an employee of Borrower and/or its Affiliates.
6.15 MERGER, CONSOLIDATION, RECAPITALIZATION AND ACQUISITION. Without
the express prior written consent of Bank, which may not be unreasonably
withheld by Bank, Borrower shall not (i) acquire, reorganize, merge or
consolidate with or into any other Person, (ii) sell, transfer or dispose of any
substantial part of its assets, (iii) issue any shares of capital stock,
warrants, rights or options to acquire, or securities convertible into, capital
stock (other than those issued in connection with Borrower's long-term incentive
compensation plans), or (iv) authorize any new class of capital stock, or (v)
make any other material change in its capitalization if, in the case of (i)
through (v), it will (A) result in a material adverse effect on the consolidated
financial condition of Borrower and its Subsidiaries, and (B) reduce voting
control of the France family members in the Borrower to less than fifty percent
(50%) in the aggregate.
6.16 SALE OF ASSETS. Borrower shall not sell, lease, convey or
otherwise dispose of any of Borrower's material assets, except for sales in the
ordinary course of business.
6.17 TRANSACTIONS WITH AFFILIATES. Except as expressly permitted
hereby, Borrower shall not make any payment to or enter into any transaction
with any Non-Company Affiliate, in excess of $100,000 in the aggregate (when
taken together with all other such payments or transactions by Borrower to
Non-Company Affiliates), other than payments to members of the France family
individually (or family-related entities controlled by France family members) or
to National Association for Stock Car Auto Racing, Inc. ("NASCAR") in the
ordinary course of business in accordance with past practices of Borrower.
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6.18 CHANGE IN BUSINESS. Borrower shall not materially change its
business focus of operations.
6.19 LEASES. Borrower shall not incur, create, or assume any direct or
indirect liability for the payment of rent or otherwise, under any lease or
rental arrangement (excluding capitalized leases) if immediately thereafter the
sum of such lease or rental payments to be made by Borrower during any 12-month
period is increased by $1,000,000 in the aggregate; PROVIDED, HOWEVER, that Bank
shall not unreasonably withhold its consent to a request by Borrower to enter
into a lease or guarantee lease payments in a principal amount not to exceed
$85,000,000 (when aggregated with all other Indebtedness and guaranties arising
in connection with the Kansas City racetrack transaction) in any 12-month period
in connection with the purchase of and financing for the Kansas City racetrack
currently under consideration.
6.20 CHANGE IN FISCAL YEAR. Borrower shall not change its fiscal year
without the consent of Bank.
6.21 CONSOLIDATED LEVERAGE RATIO. Borrower shall maintain a ratio of
Consolidated Funded Indebtedness to Consolidated EBITDA of not more than 3.00 to
1.00, verified quarterly (on the basis of Borrower's quarterly unaudited
financial statements described in SECTION 6.1(a)) for the immediately preceding
four (4) fiscal quarters.
6.22 "FUNDED DEBT TO CAPITALIZATION RATIO". Borrower shall maintain a
ratio of Consolidated Funded Indebtedness to THE SUM OF (i) Consolidated Funded
Indebtedness PLUS Consolidated Shareholders Equity of not more than fifty
percent (50%), verified annually (on the basis of Borrower's audited financial
statements described in SECTION 6.1(a)).
6.23 "MAJOR MOTORSPORTS EVENTS". Borrower will not voluntarily change
the scope and magnitude of major motorsports events conducted at facilities
controlled by Borrower or any of its Subsidiaries in a fashion which is
materially adverse to the consolidated financial condition of the Borrower or
any of its Subsidiaries.
6.24 GUARANTIES OF SUBSIDIARIES. Within fifteen (15) days of creating
or acquiring any Subsidiary, Borrower shall cause such Subsidiary to execute and
deliver to Bank a Guaranty, in form and substance substantially similar to
EXHIBIT B.
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ARTICLE VII
EVENTS OF DEFAULT
7.1 EVENTS OF DEFAULT. If any one or more of the following events
(herein called "Events of Default") shall occur, an Event of Default shall be
deemed to have occurred:
(a) PAYMENT OR PERFORMANCE. (a) If Borrower defaults in the
payment of any principal of or interest on the Note or of any other amount
payable hereunder or under any of the other Credit Documents or under any other
Indebtedness to Bank, either by the terms hereof or thereof or otherwise as
herein or therein provided; or
(b) MISREPRESENTATION. If Bank shall have made an Advance to
Borrower over and above the amount permitted hereunder; and Borrower shall not
have repaid Bank immediately for any such over-advancement; or
(c) PAYMENT AND PERFORMANCE OF KEEPWELL AGREEMENT. If
Borrower defaults in the payment or performance of any of the obligations owing
under the Keepwell Agreement described in SECTION 6.9 (beyond any period of
grace provided with respect thereto); or
(d) REPRESENTATIONS AND WARRANTIES. If any representation,
warranty, report or certification made by or on behalf of Borrower herein or in
any of the other Credit Documents or in any certificate, schedule, or other
writing furnished in connection with or pursuant to this Agreement or any of the
other Credit Documents shall be false or misleading in any material respect (i)
on the date as of which made or reaffirmed or (ii) at any other time; or
(e) SALE OF ASSETS. If Borrower sells a material portion of
its assets; or
(f) OTHER COVENANTS. If Borrower defaults in the performance
or observance of any material agreement, covenant, term or condition binding on
them contained in the Credit Documents and, except with respect to defaults in
the performance of the covenants contained in any of SECTIONS 6.9, 6.11, 6.12,
6.14, 6.15, 6.16, and 6.17 hereof (as to which there is no cure period), such
default is not remedied within thirty (30) days after its occurrence; or
(g) DEFAULT UNDER CREDIT DOCUMENTS. If a default or event
of default shall occur under any of the other Credit Documents; or
(h) LIQUIDATION, DISSOLUTION OR BANKRUPTCY. Liquidation or
dissolution of Borrower or suspension of the business of Borrower; the filing by
Borrower of a
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voluntary petition or an answer, or the filing against any of them of an
involuntary petition that is not dismissed within thirty (30) days, seeking
reorganization, arrangement, readjustment of any of their respective debts or
for any other relief under Bankruptcy Code or under any other insolvency act or
law, state or federal, now or hereafter existing, or any other action of
Borrower indicating its consent to, approval of or acquiescence in any such
petition or proceeding; the application by Borrower for, or the appointment of,
a receiver, trustee or custodian of Borrower or for all or a substantial part of
any of its property; the making by Borrower of an assignment for the benefit of
creditors; the inability of Borrower or the admission by Borrower in writing of
the inability to pay any of its debts as they mature; or the issuance of a
warrant of attachment, execution or similar process against any substantial part
of the property of Borrower that is not dismissed within thirty (30) days and
which attachment, warrant or process relates to a claim in excess of $25,000
either alone or when aggregated with all other such warrants, attachments, and
processes; or
(i) JUDGMENT. If a final judgment in excess of $5,000,000
shall be rendered against Borrower and if, within thirty (30) days after entry
thereof, such judgment shall not have been discharged or execution thereon
stayed pending appeal, or if within thirty (30) days after the expiration of any
such stay, such judgment shall not have been discharged; or
(j) INVALIDITY OF CREDIT DOCUMENTS. If (i) any of the Credit
Documents shall be deemed invalid or unenforceable for any reason; or (ii) any
Person shall contest the validity of any of the Credit Documents, PROVIDED Bank
reasonably believes that such Person's claim may be valid and such invalidity or
unenforceability could have a material adverse effect on the condition
(financial or otherwise) of Borrower, or on Bank's position vis-a-vis this
Agreement or the Note.
7.2 REMEDIES.
(a) Upon the occurrence of any Event of Default (but after
the expiration of any grace period provided herein with respect to such Event of
Default) and at any time thereafter Bank may, at its option, declare the Credit
Facility and all or any portion of the obligations owing by Borrower to Bank
under the Credit Documents to be forthwith due and payable, whereupon (or
otherwise upon the occurrence of any event described in SECTION 7.1.(h) hereof,
whether or not such declaration shall be made) the Advances and any other such
obligations shall forthwith become due and payable, without presentment, demand,
protest or other notice of any kind, all of which are expressly waived, anything
contained herein or in the other Credit Documents to the contrary
notwithstanding (other than grace periods and/or notice provisions provided for
herein), and whereafter Bank shall no longer be obligated to make any Advances
to Borrower under the Credit Facility. In addition, Bank may immediately proceed
to foreclose its mortgages or liens on or security interest in any collateral
that it may then hold and to exercise its rights under
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and to do all other things provided for by law or by the terms of the Credit
Documents. Bank shall have the sole right to determine the order in which it
enforces its rights in any collateral, the manner of sale of such collateral
(which shall be commercially reasonable) and the application of proceeds of sale
of any collateral.
(b) In addition, Borrower acknowledges the unconditional
right of Bank to pledge or transfer the Note to any third party (i) thirty (30)
days after providing notice of such sale to Borrower in the case of a pledge or
transfer at any time other than a time during which a Default has occurred and
is continuing or (ii) ten (10) days after providing notice of such sale to
Borrower in the case of a pledge or transfer at any time during which a Default
has occurred and is continuing, it being understood that in either case, at any
time during such 30-day or 10-day period, Borrower shall have the right to
purchase, or cause to be purchased by parties of its choosing, the Note under
the terms offered by the third party selected by Bank; PROVIDED, HOWEVER, that
Bank shall have an unconditional right to pledge or transfer the Note to any
party at any time following an Event of Default contained in SECTIONS 7.1(a) or
7.1(h) hereof. Subject to the conditions set forth in SECTION 6.1(b), with
respect to Borrower's consolidating financial statements, Borrower hereby grants
to Bank the right to disclose to any prospective purchaser(s) of the Note any
information requested by such prospective purchaser(s). Other than such
permitted disclosures to any such prospective purchasers, Bank shall not
disclose to any Person any confidential information regarding the financial
condition of Borrower except (i) as required by law, or court or administrative
order, (ii) information otherwise publicly available or freely usable or
obtained from another public source, (iii) basic and general information
regarding the level of lending activity and deposit activity and account status,
given in response to an inquiry from a creditor of Borrower, or (iv) with the
consent of Borrower.
ARTICLE VIII
MISCELLANEOUS
8.1 WAIVER OF DEFAULT. Bank may, by written notice to Borrower at any
time and from time to time, waive any default in the performance or observance
of any condition, covenant or other term hereof or any Event of Default that
shall have occurred hereunder and its consequences. Any such waiver shall be for
such period and subject to such conditions as shall be specified in any such
notice. In the case of any such waiver, Borrower and Bank shall be restored to
their former positions and rights hereunder and under the other Credit
Documents, and any Event of Default so waived, whether or not in writing, shall
be deemed to be cured and not continuing, but no such waiver shall extend to any
subsequent or other Event of Default or impair any right consequent thereon.
8.2 AMENDMENTS AND WAIVERS. Bank and Borrower may, subject to the
provisions of this Section, from time to time enter into written agreements for
the
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purpose of adding any provisions to this Agreement or the other Credit Documents
or changing in any manner the rights of Bank or Borrower hereunder or under the
other Credit Documents. No such amendment, modification or supplement shall be
established by custom, conduct or course of dealing, but solely by an instrument
in writing duly executed by the party to be charged therewith.
8.3 NOTICES. All notices and other communications required or permitted
hereunder or under any of the other Credit Documents shall be in writing
(including telex, telefax or telegraphic communication) and shall be delivered
personally, telexed (with appropriate answerback received), telefaxed (with
confirmation of receipt immediately thereafter by telephone), telegraphed, sent
by nationally recognized overnight courier (marked for overnight delivery), or
sent by registered, certified or express mail, postage prepaid, return receipt
requested, addressed as follows or to such other address as may be hereafter
designated in writing hereunder by the respective parties:
Borrower: International Speedway Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. France, President
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: International Speedway Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, General Counsel
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Bank: First Union National Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ -- ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. Vice President
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
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All such notices and communications shall (i) when delivered in person on any
Business Day between the hours of 9:00 AM to 5:00 PM. (local time), be effective
when delivered (or if delivered after 5:00 PM, be effective on the next Business
Day to occur), (ii) when telexed (provided the correct answerback has been
received) or telefaxed (provided receipt is immediately thereafter confirmed by
telephone) or telegraphed, in each case on any Business Day between the hours of
9:00 AM to 5:00 PM (local time), be effective when telexed, telefaxed or
delivered to the telegraph company for immediate transmittal, respectively (or
if telexed, telefaxed or delivered to the telegraph company after 5:00 PM, be
effective on the next Business Day to occur), or (iii) if mailed, be effective
three (3) Business Days after the same has been deposited in the mails, postage
prepaid, by registered or certified mail, return receipt requested, or (iv) if
sent by a nationally recognized overnight courier service, be effective one (1)
Business Day after the same has been delivered to such courier service marked
for overnight delivery; in each case addressed as aforesaid.
Any party may by notice given in accordance with this Section to the other
parties designate another address or person for receipt of notices hereunder.
8.4 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise or delay in
exercising, on the part of Bank, any right, power or privilege hereunder or
under any of the other Credit Documents shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder or
thereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies provided herein
and in the other Credit Documents are cumulative and not exclusive of any other
rights or remedies provided by law.
8.5 EXERCISE OF REMEDIES. The right is hereby given by Borrower to Bank
to make releases (whether in whole or in part) of all or any part of any
collateral held by Bank without notice to or the consent, approval or agreement
of other parties in interest, including Borrower or junior lienors, which
releases shall not impair in any manner the validity or priority of the
mortgages, liens and security interests in the remaining collateral conferred
under such documents nor release Borrower from liability for the indebtedness
thereby secured. Notwithstanding the existence of any other lien or security
interest in the collateral held by Bank, Bank shall have the right to determine
the order in which any or all of the collateral shall be subjected to the
remedies provided herein and in the other Credit Documents. The proceeds
realized upon the exercise of the remedies provided herein or therein shall be
applied by Bank in the manner herein or therein provided.
8.6 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
agreements, representations and warranties made herein shall survive the
delivery of the Note and the other Credit Documents and the making and any
renewal of the Advances, notwithstanding any investigation thereof made by Bank
or its agents.
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8.7 LIENS; SET OFF BY BANK. Borrower hereby grants to Bank a continuing
lien for the Note, the obligations under the other Credit Documents and all
other Indebtedness of Borrower to Bank upon any and all monies, securities and
other property of Borrower, and the proceeds thereof, now or hereafter held or
received by or in transit to Bank from or for Borrower, and also upon any and
all deposits (general or special) and credits of Borrower, if any, against Bank,
at any time existing. UPON THE OCCURRENCE OF ANY EVENT OF DEFAULT, BANK IS
HEREBY AUTHORIZED AT ANY TIME AND FROM TIME TO TIME, WITHOUT NOTICE TO BORROWER,
TO SET OFF, APPROPRIATE AND APPLY ANY OR ALL ITEMS HEREIN ABOVE REFERRED TO
AGAINST ALL INDEBTEDNESS OF BORROWER TO BANK, UNDER THE CREDIT DOCUMENTS OR
OTHERWISE, WHETHER NOW EXISTING OR HEREAFTER ARISING.
8.8 ENTIRE AGREEMENT. This Agreement, together with the other Credit
Documents and other documents executed in connection herewith or contemplated
hereby, contains the entire agreement of the parties regarding the subject
matter hereof. The parties acknowledge that Bank has made no promises,
agreements, conditions, undertakings, warranties or representations that are not
specifically set forth in such agreements.
8.9 ENFORCEABILITY. Should any one or more of the provisions of this
Agreement be determined to be illegal or unenforceable as to one or more of the
parties, all other provisions nevertheless shall remain effective and binding on
the parties hereto.
8.10 REIMBURSEMENT OF EXPENSES. Borrower shall reimburse Bank on demand
(a) for all costs and out-of-pocket expenses (including without limitation
reasonable attorneys' fees, appraisal fees, accounting fees, brokerage fees,
title insurance premiums, recording fees and other reasonable expenses),
directly or indirectly incurred in connection with the preparation, execution,
delivery, modification, waiver and amendment of this Agreement and the other
Credit Documents and (b) for all expenses incurred by Bank (including without
limitation reasonable attorneys' fees, court costs and other expenses, whether
or not incurred in trials, appeals, bankruptcy actions or otherwise) in the
enforcement of this Agreement or the other Credit Documents or in the collection
of any indebtedness or other amounts owing under this Agreement or the other
Credit Documents.
8.11 EXECUTION OF COUNTERPARTS. The Credit Documents may be executed in
any number of counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which together
shall constitute one and the same instrument.
8.12 STAMP OR OTHER TAXES. Borrower shall pay any and all stamp,
documentary, excise and intangible taxes and recording fees now or hereafter
payable in respect of this Agreement, the Note, and the other Credit Documents
or any modifica tion(s) thereof, and shall hold Bank harmless with respect
thereto. Bank may,
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but shall not be obligated to, at any time or from time to time, debit any
deposit account of Borrower at Bank for the amount of any such taxes.
8.13 WAIVER OF JURY TRIAL; ARBITRATION. EACH OF BANK AND BORROWER
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY
HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR BANK TO ENTER INTO THIS
AGREEMENT AND THE OTHER CREDIT DOCUMENTS. Upon demand of either party hereto,
whether made before or after institution of any judicial proceeding, any
dispute, claim or controversy arising out of, connected with or relating to this
Agreement and other Credit Documents ("Disputes") between or among parties to
this Agreement shall be resolved by binding arbitration as provided herein.
Institution of a judicial proceeding by a party does not waive the right of that
party to demand arbitration hereunder. Disputes may include, without limitation,
tort claims, counterclaims, disputes as to whether a matter is subject to
arbitration, claims brought as class actions, claims arising from Credit
Documents executed in the future, or claims arising out of or connected with the
transaction reflected by this Agreement.
Arbitration shall be conducted under and governed by the Commercial
Financial Disputes Arbitration Rules (the "Arbitration Rules") of the American
Arbitration Association (the "AAA") and Title 9 of the U.S. Code. All
arbitration hearings shall be conducted in the city of the Principal Office. The
expedited procedures set forth in Rule 51 ET SEQ. of the Arbitration Rules shall
be applicable to claims of less than $1,000,000.00. All applicable statutes of
limitation shall apply to any Dispute. A judgment upon the award may be entered
in any court having jurisdiction. The panel from which all arbitrators are
selected shall be comprised of licensed attorneys. The single arbitrator
selected for expedited procedure shall be a retired judge from the highest court
of general jurisdiction, state or federal, of the state where the hearing will
be conducted or if such person is not available to serve, the single arbitrator
may be a licensed attorney. Notwithstanding the foregoing, this arbitration
provision does not apply to disputes under or related to swap agreements.
8.14 GOVERNING LAW. This Agreement and the other Credit Documents
issued hereunder shall be governed in all respects by the laws of the State of
Florida.
IN WITNESS WHEREOF, each Borrower and Bank have caused this Agreement
to be duly executed under seal as of the day and year first above written.
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INTERNATIONAL SPEEDWAY CORPORATION
By /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
FIRST UNION NATIONAL BANK
By /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
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